96 GENERAL POLICY 



mining and metallurgical industries, the development of 

 hydro-electric power schemes, as well as the building of 

 power driven mills and factories in those cities which become 

 industrial centres. It is not to be supposed, however, that 

 the development of urban industries alone is important : 

 it is nearly of equal importance to develop rural industries. 

 This will take two directions : in the first place, the 

 introduction of machinery, largely driven by hand or bullock 

 power, for carrying out the simple operations of the 

 villages ; and on the other hand, the introduction and 

 fostering of suitable cottage industries, such as the knitting 

 of hosiery, and making of toys which the peasants can carry 

 on in their spare time. Every device which makes labor 

 more efficient, or enables people to work in what would 

 otherwise be waste time, increases the total production of 

 wealth and tends to raise the standard of living. 



I am not here concerned with the development of urban 

 industries, excepting to point out that their healthy growth 

 will have a reflex action upon the standard of living of the 

 cultivating classes, and this in two ways partly by attract- 

 ing labor, from the agricultural districts and thus forcing 

 cultivators to adopt more efficient methods of employing 

 labor, with the use of machinery, and partly by making 

 manufactured commodities of all kinds cheaper for the rural 

 population to purchase. 



Limits of State Aid and Intervention 



I revert, therefore, to the general problem of the direct 

 improvement of the condition of the rural population ; and 

 I propose now to discuss the extent to which it is necessary 

 that the State should take the initiative therein. It appears 

 to me to be the function of the State to adopt every measure 

 which it can to promote the improvement of agriculture. 

 In pursuing this aim it is important to work in three 

 distinct directions at the same time : (1) by stimulating 



